Department of Energy Washington, DC 20585

February 28, 2019

Sent via email: Rulemaking.Comments@nrc.gov Secretary, U.S. Nuclear Regulatory Commission ATTN: Rulemakings and Adjudications Staff Washington, DC 20555-0001

Subject: Docket ID NRC-2017-0032, DOE Comments on the Proposed Rule for Title 10 Code of

Federal Regulations (CFR) Paits 170 and 171, "Revision of Fee Schedules; Fee Recovery for Fiscal Year 2019," published in the Federal Register on January 31, 2019

To Whom It May Concern:

The U.S. Department of Energy (DOE) has reviewed the subject Proposed Rule and hereby submits the following comment:

The U.S. Department of Energy (DOE) has reviewed the proposed 10 CFR 170 and 171 fee schedule for fiscal year 2019. DOE finds the basis for the total annual fee amount and the level of effort to support the general licenses for Uranium Mill Tailings Radiation Control Act (UMTRCA) sites is not presented in the proposed rule or the associated work papers. Additionally, the basis for allocation percentages for DOE and the other uranium recovery licensee of the generic/other uranium recovery costs in the proposed rule and work papers is not presented. DOE requests the U.S. Nuclear Regulatory Commission (NRC) clarify the rationale for the various fee components used to determine the total charge. Lastly, DOE requests the NRC describe what major activities it will accomplish in support of DOE management of UMTRCA sites. This will help DOE evaluate whether the proposed NRC scope is consistent with anticipated DOE activities and establish the basis for DO E's estimate of annual uranium licensee fees in its budget request to Congress.

Please contact me at (202) 586-8324, or Paul.Kerl@hg.doe.gov, or Mark Kautsky, UMTRCA Program Manager, at (970) 248-6018 or Mark.Kautsky@lm.doe.gov, if you have any questions. Please address any correspondence to:

U.S. Department of Energy Office of Legacy Management 2597 Legacy Way Grand Junction, CO 81503

Enclosure

Sincerely,

Paul Kerl UMTRCA/NVOS Team Lead

® Printed with soy ink on recycled paper

PR-170 and 171

84 FR 5786

cc w/enclosure: M. Kautsky, DOE-LM (e) D. Shafer, DOE-LM (e) J. Carman, Navarro (e) DOE Read File File: ADM 0030.10 (records)

Mgrs\Kautsky\2019 .02.19 DOE Response re NRC 2019 Proposed Rule 10 CFR 171

Review of 10 CFR 170 and 171 "Revision of Fee Schedules; Fee Recovery for Fiscal Year 2019" Proposed Rule

1.0 Introduction

The Uranium Mill Tailings Radiation Control Act (UMTRCA) is a federal law that provides for safe and environmentally sound disposal and control of uranium mill tailings at legacy U.S. uranium mill sites. Under this legislation, the U.S. Nuclear Regulatory Commission (NRC) regulates U.S. Department of Energy (DOE) activities at both UMTRCA Title I and Title II sites. Every year, NRC amends the licensing, inspection, and annual fees charged to DOE and other applicants and licensees. These fee-schedule modifications are codified annually in Title 10 Code of Federal Regulations Sections 170-171 (10 CFR 170-171). By law, NRC is required to recover 90% of its operating budget through the assessment of application fees, license fees, and fees for other support. 1

The total amount that NRC assesses is based on congressional appropriations, which can change every year.

This memorandum presents the results of Navarro Research and Engineering, Inc.'s, review of NRC' s proposed fee-schedule modifications for fiscal year (FY) 2019 (Vol. 84 Federal Register 578-603 [84 FR 578-603]) as the fees apply to the DOE Office of Legacy Management long-term surveillance and maintenance program. Comments on the proposed rule for FY 2019 must be submitted to NRC by March 4, 2019.

To support this discussion, four exhibits are provided following the text. Table 1 summarizes the actual NRC fee schedules for FY 2009 through FY 2018 (based on final rules) and the proposed NRC fee schedule for FY 2019. Figure 1 is a graphical illustration of the annual fees paid by DOE, based on the fees presented in Table 1. Figures 2 and 3 are scanned excerpts of the most relevant portions of the proposed rule for FY 2019 and supporting NRC work papers.

2.0 Analysis of Proposed Rule

The proposed annual fee to be assessed to DOE for FY 2019 is $120,000, which is 1.6% less than the $122,000 annual fee for FY 2018 and also lower than any annual fee assessed in the last 13 years (since before FY 2006). As shown in Table 1 and Figure 1, between FY 2009 and FY 2018, the annual fee has ranged from $122,000 in FY 2018 to $815,000 in FY 2014. NRC attributes the decrease in DOE' s UMTRCA annual fee to a reduction of budgeted resources and an increase in estimated 10 CFR 170 billings due to anticipated work on the Atlantic Richfield (Bluewater, New Mexico, Disposal Site) review (Figure 2). Other noteworthy aspects ofNRC's proposed fee schedule for FY 2019 include the following:

• NRC proposes to increase the current hourly rate by about 1.1 %, from $275 to $278. NRC attributes this increase to the decline in the number of mission-direct full-time equivalent (FTE) staff compared to FY 2018 (primarily due to the standardization and centralization of mission support functions within the programmatic offices and attainment of Agreement State

1 NRC collects service fees for work that provides specific benefits to identifiable applicants and licensees (such as licensing work, inspections, and special projects) ( 10 CFR 170). But because NRC' s fee recovery under 10 CFR 170 does not equal 90% of its budget authority for the fiscal year, it also assesses "annual fees" under 10 CFR 171 authority to recover the remaining amount necessary to meet the fee-recovery requirement. Congress appropriates the remaining 10% of the annual NRC budget.

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authority by the state of Wyoming). Mission-direct FTE productive hours remain unchanged at 1510 (84 FR 578-603) .

• On the basis ofNRC work papers (Figure 3) (NRC 2019), the NRC resources budgeted for DOE UMTRCA program oversight decreased from 0.9 to 0.8 FTE (FY 2018 vs. FY 2019). Therefore, in FY 2019, DOE should anticipate about 1208 hours of dedicated NRC resources for DOE UMTRCA sites (0.8 FTE x 1510 hours per FTE), in contrast to the 1359 hours allocated in FY 2018. Based on these estimates, NRC UMTRCA oversight is anticipated to decrease by 11 %.

• NRC attributes the reduction in FY 2019 proposed budgeted resources for uranium recovery licensee support to (1) transition of Wyoming to Agreement State status and "realignment" of the UMTRCA program to reflect the transfer of regulatory authority for all but one uranium recovery site to Wyoming; and (2) moving some scope and associated resources into a afee relief category that addresses non-site specific NRC support, "In situ leach rulemaking and unregistered general licenses" (84 FR 578-603). This fee relief category is funded by the Congressional appropriation and is not subject to fee recovery.

• NRC offers fee relief that represents the amount of the 10% of the total budget appropriated by Congress that is not budgeted for activities that are exempt from cost recovery requirements. The fee-relief "credit" was a surcharge of $854 7 in FY 2018 and is proposed to be a credit of $21 in FY 2019 (line 8 of Table 1). NRC states the FY 2019 budgeted resources for its fee-relief (i.e., cost recovery-exempt) activities are $86.6 million. NRC ' s 10% Congressional appropriation in FY 2019 is $86.8 million, leaving a $0.2 million fee-relief credit that will reduce all licensees ' annual fees based on their percentage share of the budget (NRC 2019).

• For FY 2019, total uranium recovery license fee receipts will be $169,614. DOE will bear 71 % of this cost, higher than the 34% proportion assessed in FY 2018 but comparable to other years covered by this evaluation (2009-2019). The remaining 29% will be borne by the one remaining non-DOE uranium recovery licensee regulated directly by NRC.

• NRC allocates 10% of general/other uranium recovery costs to DOE and the remaining 90% of these costs to the one remaining uranium recovery licensee under direct NRC regulatory oversight. These proportions are not consistent with previous years because the uranium recovery fee class changed significantly with Wyoming attaining Agreement State authority.

3.0 Summary

The majority ofNRC' s budgeted costs for the UMTRCA program reflect the estimated level of effort (FTEs) that NRC designates annually. The proposed 11 % reduction in NRC budget allocations for oversight of UMTRCA sites in FY 2019 does not correspond to an anticipated decrease in LM ' s activities at those sites. NRC attributes the proposed decrease in resource allocation to a realignment ofUMTRCA support, reduction in associated licensing work, and an increase in estimated billings for work on the Atlantic Richfield (Bluewater) site.

NRC does not provide the basis for the allocation of generic/other fees between DOE (10%) and the one uranium recovery licensee under direct NRC oversight (90%) . NRC support to DOE will include meetings, resolution of direct regulatory issues, and other non-specific support. The fees seem reasonable when considered in the context of anticipated support and historical fee assessments. Therefore, Navarro Research and Engineering, Inc., recommends that any comments that DOE provides to NRC on the proposed rulemaking focus on the inability of the reviewers to determine how allocation proportions are derived.

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Table 1. Summary of NRG Fee-Schedule Line Items Affecting DOE Annual Fee Amounts: FY 2009-2018 /and Proposed FY 2019 Amounts)

Line Fee Category/Endpoint FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

FY 2019 No. (Proposed)

Hourly rate $257 $259 $273 $274 $272 $279 $268 $265 $263 $275 $278

Full-time equivalents (FTEs) allocated for 0.70 1.18 2.25 2.0 2.0 2.2 1.9 1.8 1.9 0.9 0.8 2 DOE UMTRCA' (1371) (1371) (1371) (1371) (1351 ) (1375) (1420) (1440) (1500) (1510) (hour; per direct FTE) (1510)

3 FTE annual rate $352,347 $355,089 $374,283 $375,654 $367,472 $383,625 $380,560 $381,600 $394,500 $415,250 $419,780 (= hourly rate • hours per direct FTE)

•l UMTRCA Title I (and Title II) Budgeted $246,563 $419,769 $745,889 $751,298 $666,626 $774,185 $622,898 $503,708 $574,595 $147,161 $114,988 Costs Less 10 CFR 170 Receipts

5 Generic/other uranium recovery budgeted costs for fee classb

$289,786 $434,143 $313,320 $385,090 $404,870 $420,090 $419,860 $411,570 $190,790 $324,340 $54,840

6 Total assessed percentage of generic

35% 35% 10% 10% 10% 10% 10% 10% 10% 10% 10% costs

7 Generic/other uranium recovery budgeted $101,425 $151,950 $31,312 $38,509 $40,487 $42,009 $41,986 $4 1,157 $19,079 $32,434 $5484 costs assessed to DOE (= line 5 x line 6)

8 Uranium recovery fee-relief adjustmentb -$9400 +$18,519 -$4992 - $10,464 - $7084 - $1554 -$1251 -$94 +$21 ,940 +$8,547 -$21

Total Annual Fee Assessed to DOEc: $339,000 $590,000 $772,000 $779,000 $700,000 $815,000 $666,000 $545,000 $616,000 $122,000 $120,000

0 Sum of UMTRCA budgeted costs (line 4) :.J.1 portion V·1 oortion Lt\·\ portion LM portion LM oartion LM oortion LM pMion LM portion Lrvl portion u...i portion LM Portion

and adjustments in lines 7 and 8; values = 62.5% = 62.5% = 75% = 75% = 100% = 1Qffl/o : 100% ; 100% = 100% = 100% = 100% rounded

10 Total annual fee amount for other uranium $170,904 $316,586 $236,887 $252,401 $300,621 $364,096 $377,874 $369,571 $369,178 $368,828 $49,163 recovery licenses

1' Total fees assessed, all uranium recovery $509,904 $906,586 $1,008,887 $1,031,401 $1 ,000,621 $1,179,096 $1,055,129 $914,751 $985,178 $490,828 $169,163 facilities fee class

12 Percentage of uranium recovery facilities 66% 65% 77% 76% 70% 69% 63% 60% 61% 34% 71% fee class borne by DOE

Notes: a FTEs established by NRC exclude all nonmission direct hours. such as training, general administration, and leave. b Both the generic/other uranium recovery budgeted costs and the uranium recovery fee-relief adjustments have varied greatly over the years; their basis is not clear. ' Annual fees assessed to DOE in FY 2006 and 2007 (not shown in this table) were $732,000 and $584,000, respectively. Before FY 2013, LM's portion of the total Uranium Recovery Facilities fee class was split with the DOE Office of Environmental Management,

charged with remediating the Moab, Utah, UMTRCA Title I site.

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$900,000

$800,000

$700,000

$600,000

- $500,000 ~ -- $400,000 C :::, 0 E $300,000 c(

$200,000

$100,000

$0

U.S. Department of Energy February 20 19

$815K

$772K

Fiscal Year (FY)

UMTRCA Budgeted Costs

N TotalAnnualFee

Generic/Other Budgeted Costs

-.-Total Annual Fee (line chart)

K = x 1000 ($)

Figure 1. 10 CFR 171: NRG Annual Fees and Budgeted Costs Assessed to DOE since FY 2009

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TABLE XI-ANNUAL FEE SUMMARY CALCULATIONS FOR URANIUM RECOVERY FACILITIES

[Dollars in nilllons]

summary 1ee calculations

Total budgeted resources Less estimated 10 CFR part 170 receipts

Net 10 CFR part 171 resources .................... ..... . Allocated genenc transportation .... ...... . Fee-relief adjus1ment ..... ........ .. ......... .. . Bil ling adjus1ments .... ...... ................. .... .

Total re(J..Jired annual tee recovery

In r.n mp,. ri,;nn In FY 2018, tho FY 201 ~bu dgeted resou rces for uran ium rocuverv lic.:eusees uec.:reustJu uu e tu th e transition o f Wyom ing to Agreement State status and subsequent realignment of the Ura nium Mill Tai lings Rad iation Control Act (CMTRCA) progiam . In ,,d rlitinn, lmrlgr.tnrl rosonrms rlor.ronsr.rl as a result of exp and ing the existing fee­rnlief categu ry . "II, Situ liu,c h rulemaking and unregistered general

lknnsns · tn inr.l 11dr. arl cl itinnn l T:rnn ium Recoverv activ it..i es in order to ensure nquitnhi.lily nntl I hr. stnhili ty nf onnunl fees.

The NRC regulates DOE's Title I and Tit l0 II nr.tivitf0S unrl r.r IJMTRC.A r. ,-.nrl the proposed annual fee to DOE inr.l url ns rhr. r.nst,; ,;pr.dfir.nlly h11rlgr,t0d for the NRC's l lMTRCA Title I and II HCtivi lies, .,.,; well as 10 perc.:enl u ftl rn remain ing budgeted costs for this fee

FY 2018 FY 2019 Percentage 1in81 proposed change

S13.5 $1.1 -91 .9 -12.9 -0.9 -93.0

0.8 0.2 - 66.7 NIA NiA NIA

- 0.1 0.0 100 0.0 0.0 0.0

0.5 0.2 - 60 0

r.las,. Thr. noF ·s l :'vtTRCA .. nnnal fon decreased slightly due to the budgeted resources reduction and an increase in rstim,,rnrl 10 C.FR p,irt 170 hi I lings for w ork on the Atlantic Richfield review. The NRC assesses the remai ning 90 percent of its budgeted costs to th,, remaining licensee in this fee class. as described in the work papers. This is rellectetl in T•ble Xll tts follows:

TABLE X II-COSTS RECOVERED THROU GH ANNUA L FEES; URANIUM RECOVERY FEE CLASS

Summa'Y. of costs

DOE Anrual Fee Amount (UMTRCA TiUe I and Title II ) General Lic:11nS&S: UMTRCA TIU• I and Titie II budgeted costs less 10 CFR part 170 receipts 10 percent of genetic/other uranium recowry budgeted costs 10 percent of uranium recovery 1ee-relie1 adjustment

Total Annual Fee Amount tor DOE (rounded) Arn.Jal Fee Amount for Other Urmium Recovery Licenses :

90 percent of generic/Olher uranium recovery budgeted costs less the amounts specifi-cally budgeted for UMTRCA TiUe I and TiUe II aclivitios ..... .... ...... ......... ....... .

90 percent of uranium recovery fee-relief adjustment . . ..... ..... .............. ..... ..

Total Annual Fee Amount for Other Uranium Recovery Licenses

Furt hor, fin l hi~ nnn-OOF. lir.nnsr.os, the '.\/RC contin ues to use a matrix to determine the effort leve ls associated w ilh cunu uc.:liui,; the 1,'t'lltJric ragul~tury actions for the d ifferen t lice nsees in this fuP. dass; this is simila r tn thP. NRC 's "IJJlruach fur foal fo<.:i litias. tlescril>eu previously .

'f'.hr. matrix nrnt hnrln logy for urani um recovery licensees first identifies the lic.:eusee cat!!guries iud utleu w ilh in this fee class (exclud ing DOE). These c..:1::1.lHgurit:t::j Mr!:t: Cu11vtmUurn:tl urH.ui um mills end heap leach facilities ; u ranium In Situ Recovery (!SRI and resiu !SR facilities ; and mil I tailings disposal facilities. The matrbc identifies the types

FY 2018 FY 2019 Percentage final proposed annual fee annual fee change

SS0.921 $114,988 42.1 47.n3 5,484 -88.5 - 6.n4 - 21 99.7

122,000 120,000 - 1.6

429,509 49,355 - 88.5 - 60,517 - 192 99.7

368,992 49,163 86 7

nf npornting nr. ti vit ios that ~upport ond benefit these li censees. a long with each acl ivily·s rtJ lttli ve weight (for 111urtJ in fo rmatio n. see t he work papers). Curre11lly, there is unly u11tt remHiu iug non-DOE licensee wh ich is a Basic In Situ Recovery facility. Table XIII displays the benefit factors for the non­DOE licensee in that fae category;

Figure 2. Excerpt from January 31 , 2019, Proposed Rule Applicable to DOE Fee Assessment (84 FR 578-603)

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TOTAL .ANNUAL FEE AMOUNT(~. fee-re•ef adjustment): TOTAL FEE-RB.IEF ADJ~ENT:

TOTAL:

OROUP1 Calculation of DOE Annual Fee

Fee catej,ory FTE

18.B, DOE UMTRCA Budgeted Costs: so 0.80 10% x (Total Annual Fee Amount(e,q;l. Fee-Rellef) less UMTRCA) .

10% of Fee-Relief Activities

Figure 3. DOE Annual Fee Derivation

URANIUM RECOYE~Y ANNUAL FEES

FY2019·

TOTAL · $189,828

·214 $169,614

Less: Part 170 Taul FTI! Rate Receipts Fee

$419,767 -$220,825 $114,988

SS.484

-$21

. Total: -=""'.ic$1:'E20!!",4"'5e-1 OOE's Amual Fee Rounded: ,$120!000

(Excerpted from FY 2019 NRC Proposed Fee Rule Work Papers [NRG 2019])

4.0 References

84 FR 578-603. U.S . Nuclear Regulatory Commission, "Revision of Fee Schedules; Fee Recovery for Fiscal Year 2019 ," Federal Register, January 31, 2019.

NRC (U.S. Nuclear Regulatory Commission), 2019. FY 2019 Proposed Fee Rule Work Papers, ADAMS accession number ML18361A780.

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